<PAGE>1

                                 UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                    FORM 10-Q

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

For the quarterly period ended December 31, 2000    Commission File No. 0-23271

                         RICHMOND COUNTY FINANCIAL CORP.
             (Exact name of Registrant as specified in its charter)

              Delaware                                 06-1498455
     (State of Incorporation)           (I.R.S. Employer Identification Number)

                              1214 Castleton Avenue
                          Staten Island, New York 10310
               (Address of principal executive offices) (Zip Code)
                                  718-448-2800
              (Registrant's telephone number, including area code)


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

                                    Yes  X     No
                                        ---       ---

Indicate the number of shares  outstanding  of each of the  Issuer's  classes of
common stock, as of the latest practicable date.

As of  February  12,  2001,  there were  26,711,035  shares of the common  stock
outstanding.


<PAGE>2


                                    FORM 10-Q
                         RICHMOND COUNTY FINANCIAL CORP.
                                     INDEX

                                                                         Page

PART I.  FINANCIAL INFORMATION

ITEM 1. Financial Statements (Unaudited)

Consolidated Statements of Financial Condition
at December 31, 2000 and June 30, 2000..................................   3

Consolidated Statements of Operations
for the three and six months ended December 31, 2000 and 1999...........   4

Consolidated Statements of Changes in Stockholders' Equity
for the six months ended December 31, 2000 and 1999.....................   5

Consolidated Statements of Cash Flows
for the six months ended December 31, 2000 and 1999.....................   6

Notes to Unaudited Consolidated Financial Statements....................   7

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

ITEM 3.  Quantitative and Qualitative Disclosures about Market Risk.....  18


PART II. OTHER INFORMATION

ITEM 1.  Legal Proceedings..............................................  19

ITEM 2. Changes in Securities and Use of Proceeds.......................  19

ITEM 3. Defaults Upon Senior Securities.................................  19

ITEM 4. Submission of Matters to a Vote of Security Holders.............  19

ITEM 5. Other Information...............................................  19

ITEM 6. Exhibits and Reports on Form 8-K................................  19

Exhibit Index...........................................................  20

Signature Page..........................................................  21

================================================================================

Statements  contained  in this Form  10-Q  which  are not  historical  facts are
forward-looking  statements,  as that term is defined in the Private  Securities
Litigation  Reform Act of 1995. Such  forward-looking  statements are subject to
risks and  uncertainties  which could cause actual results to differ  materially
from those projected.  Such risks and uncertainties include potential changes in
interest rates, competitive factors in the financial services industry,  general
economic  conditions,  the effect of new legislation and other risks detailed in
documents filed by the Company with the Securities and Exchange  Commission from
time to time.

================================================================================

<PAGE>3


                 RICHMOND COUNTY FINANCIAL CORP. AND SUBSIDIARY
                 CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
               (In Thousands, Except Share and Per Share Amounts)
<TABLE>
<CAPTION>


                                                                            December 31,     June 30,
                                                                                2000           2000
                                                                            ------------   ------------
                                                                            (Unaudited)
<S>                                                                         <C>            <C>
                     Assets

Cash and due from banks                                                      $   50,496     $   47,684
Federal funds sold                                                               37,900              -
Securities held to maturity:
     Mortgage-backed and mortgage-related securities                             55,571         57,161
       (estimated market value of $54,925 and $54,068, respectively)
Securities available for sale:
     Investment securities                                                      268,318        257,485
     Mortgage-backed and mortgage-related securities                            714,613        707,446
Mortgage loans:
     1-4 family                                                                 988,218        842,350
     Multifamily                                                                631,903        549,151
     Commercial real estate                                                     107,121        108,532
     Construction                                                                83,613         65,603
                                                                            ------------   ------------
Total mortgage loans                                                          1,810,855      1,565,636
Other loans                                                                      23,477         21,478
     Plus:  Unearned loan fees, net                                               3,023          1,392
     Less:  Allowance for loan losses                                           (18,749)       (14,698)
                                                                            ------------   ------------
Loans, net                                                                    1,818,606      1,573,808
Federal Home Loan Bank stock                                                     41,199         38,873
Banking premises and equipment, net                                              30,045         26,115
Accrued interest receivable                                                      21,091         18,170
Other real estate owned                                                             106            509
Goodwill                                                                         70,358         43,324
Other assets                                                                    104,760        110,646
                                                                            ------------   ------------
          Total assets                                                       $3,213,063     $2,881,221
                                                                            ============   ============
                     Liabilities and Stockholders' Equity
Demand deposits                                                              $  225,120     $  207,894
Savings, N.O.W. and Money market accounts                                       993,855        888,706
Certificates of deposit                                                         874,227        693,276
                                                                            ------------   ------------
          Total deposits                                                      2,093,202      1,789,876
Borrowings                                                                      791,032        773,690
Accrued expenses and other liabilities                                           13,572         11,245
                                                                            ------------   ------------
          Total liabilities                                                   2,897,806      2,574,811
                     Stockholders' Equity
Preferred stock, $.01 par value, 5,000,000 shares authorized; none issued             -              -
Common stock, $.01 par value, 75,000,000 shares authorized; 32,737,134
  issued; 26,759,235 and 28,001,472  shares outstanding,
  at December 31, 2000 and June 30, 2000, respectively.                             327            327
Additional paid-in-capital                                                      329,772        329,718
Retained earnings-substantially restricted                                      155,886        145,231
Unallocated common stock held by
  Employee Stock Ownership Plan ("ESOP")                                        (29,385)       (30,249)
Unearned compensation on MRP Stock                                              (11,410)       (13,147)
Treasury stock, at cost, 5,977,899 and 4,735,662 shares
  at December 31, 2000 and June 30, 2000, respectively.                        (109,055)       (82,541)
Accumulated other comprehensive income:
  Net unrealized loss on securities available for sale, net of tax              (20,878)       (42,929)
                                                                            ------------   ------------
          Total stockholders' equity                                            315,257        306,410
                                                                            ------------   ------------
          Total liabilities and stockholders' equity                         $3,213,063     $2,881,221
                                                                            ============   ============
</TABLE>

     See accompanying notes to unaudited consolidated financial statements.

<PAGE>4

                 RICHMOND COUNTY FINANCIAL CORP. AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF OPERATIONS
               (In Thousands, Except Share and Per Share Amounts)
<TABLE>
<CAPTION>


                                                                             For the                 For the
                                                                        Three Months Ended       Six Months Ended
                                                                            December 31,            December 31,
                                                                       --------------------    --------------------
                                                                            (Unaudited)             (Unaudited)
                                                                         2000        1999        2000        1999
                                                                       --------    --------    --------    --------
<S>                                                                    <C>         <C>         <C>         <C>
Interest  income:
   Loans                                                               $ 35,048    $ 28,030    $ 68,537    $ 54,093
   Debt and equity securities                                             6,884       6,357      13,512      12,581
   Mortgage-backed and mortgage-related securities                       14,296      14,025      27,994      28,271
   Federal funds sold and interest-earning bank balances                    154          65         382         247
                                                                       --------    --------    --------    --------
     Total interest income                                               56,382      48,477     110,425      95,192
                                                                       --------    --------    --------    --------
Interest  expense:
   Deposits                                                              19,269      13,414      36,988      25,927
   Borrowed funds                                                        10,933      10,801      21,644      21,415
                                                                       --------    --------    --------    --------
     Total interest expense                                              30,202      24,215      58,632      47,342
                                                                       --------    --------    --------    --------
   Net interest income                                                   26,180      24,262      51,793      47,850
   Provision for loan losses                                                300         300         600         600
                                                                       --------    --------    --------    --------
   Net interest income after provision for loan losses                   25,880      23,962      51,193      47,250
                                                                       --------    --------    --------    --------
Non-interest  income:
   Fee income                                                             3,210       2,672       5,873       5,112
   Net gain/(loss) on sale of securities and  loans                          73           7          (3)        710
   Other                                                                    814         780       1,639       1,554
                                                                       --------    --------    --------    --------
     Total non-interest income                                            4,097       3,459       7,509       7,376
                                                                       --------    --------    --------    --------
Non-interest  expense:
   Salaries and employee benefits                                         7,766       7,191      15,205      14,006
   Occupancy costs                                                        1,704       1,514       3,356       3,001
   Computer service fees                                                  1,600       1,395       3,029       2,789
   Advertising                                                              571         428       1,071         919
   FDIC insurance premiums                                                   80         123         200         238
   Other                                                                  2,079       1,732       3,924       3,467
                                                                       --------    --------    --------    --------
     Total general and administrative expense                            13,800      12,383      26,785      24,420
   Amortization of goodwill and other intangibles                         1,226         818       2,332       1,635
                                                                       --------    --------    --------    --------
     Total non-interest expense                                          15,026      13,201      29,117      26,055
                                                                       --------    --------    --------    --------
   Income before income taxes                                            14,951      14,220      29,585      28,571
   Provision for income taxes                                             5,347       5,192      10,617      10,434
                                                                       --------    --------    --------    --------
   Net income                                                          $  9,604    $  9,028    $ 18,968    $ 18,137
                                                                       ========    ========    ========    ========
   Earnings per share:
          Basic                                                        $   0.40    $   0.33    $   0.78    $   0.65
          Diluted                                                      $   0.39    $   0.33    $   0.76    $   0.65
</TABLE>
          See accompanying notes to unaudited consolidated financial statements.


<PAGE>5


                RICHMOND COUNTY FINANCIAL CORP. AND SUBSIDIARY
          CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
             (In Thousands, Except Share and Per Share Amounts)
<TABLE>
<CAPTION>
                                                           RETAINED      ACCUMULATED    UNALLOCATED
                                              ADDITIONAL   EARNINGS         OTHER         COMMON       UNEARNED
                                      COMMON   PAID-IN   SUBSTANTIALLY  COMPREHENSIVE   STOCK HELD   COMPENSATION TREASURY
                                      STOCK    CAPITAL    RESTRICTED    INCOME/(LOSS)     BY ESOP    0N MRP STOCK   STOCK    TOTAL
                                     -----------------------------------------------------------------------------------------------
<S>                                  <C>      <C>         <C>           <C>             <C>          <C>         <C>       <C>
BALANCE AT JUNE 30, 2000             $   327  $ 329,718   $ 145,231     $ (42,929)      $ (30,249)   $ (13,147)  $(82,541) $306,410

Comprehensive income:
  Net income                               -          -      18,968             -               -            -          -    18,968
  Net unrealized loss on
     certain securities, net of tax        -          -           -        22,051               -            -          -    22,051
                                                                                                                           ---------
Comprehensive income                                                                                                         41,019
                                                                                                                           ---------
Allocation of ESOP and MRP stock           -        159           -             -             864        1,737          -     2,760
Common stock repurchased
     (1,264,207 shares)                    -          -           -             -               -            -    (26,913)  (26,913)
Treasury stock issued for
  options exercised (21,970 shares)        -       (105)          -             -               -            -        399       294
Cash dividends paid on common stock        -          -      (8,313)            -               -            -          -    (8,313)
                                     -----------------------------------------------------------------------------------------------
BALANCE AT DECEMBER 31, 2000         $   327  $ 329,772   $ 155,886     $ (20,878)      $ (29,385)   $ (11,410) $(109,055) $315,257
                                     ===============================================================================================

BALANCE AT JUNE 30, 1999             $   327  $ 330,122   $ 122,784     $ (16,192)      $ (31,978)   $ (16,885) $ (17,967) $370,211

Comprehensive income/(loss):
  Net income                               -          -      18,137             -               -            -          -    18,137
  Net unrealized loss on
     certain securities, net of tax        -          -           -       (19,354)              -            -          -   (19,354)
                                                                                                                           ---------
Comprehensive loss                                                                                                           (1,217)
                                                                                                                           ---------
Adjustments                                -        624           -             -               -            -          -       624
Allocation of ESOP and MRP stock           -         49           -             -             864        1,704          -     2,617
Common stock repurchased
     (1,276,717 shares)                    -          -           -             -               -            -    (23,897)  (23,897)
Treasury stock issued for
  options exercised (23,217 shares)        -       (279)          -             -               -            -        396       117
Cash dividends paid on common stock        -          -      (6,682)            -               -            -          -    (6,682)
                                     -----------------------------------------------------------------------------------------------
BALANCE AT DECEMBER 31, 1999         $   327  $ 330,516   $ 134,239     $ (35,546)      $ (31,114)   $ (15,181) $ (41,468) $341,773
                                     ===============================================================================================
</TABLE>
      See accompanying notes to unaudited consolidated financial statements.

<PAGE>6

                 RICHMOND COUNTY FINANCIAL CORP. AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                  (In Thousands)
<TABLE>
<CAPTION>
                                                                                       For the
                                                                                   Six Months Ended
                                                                                     December 31,
                                                                                ----------------------
                                                                                    (Unaudited)
                                                                                   2000         1999
                                                                                ---------    ---------
<S>                                                                             <C>          <C>
Net cash provided by operating activities                                       $  21,613    $  15,163

Cash flows from investing activities:
     Increase in loans receivable, net                                           (174,198)    (260,430)
     Loans sold                                                                     3,118       37,313
     Investment securities available for sale:
          Sales and redemptions                                                    29,096       54,783
          Purchases                                                               (27,145)     (36,742)
     Mortgage-backed and mortgage-related securities held to maturity:
          Principal collected                                                       1,591            -
     Mortgage-backed and mortgage-related securities available for sale:
          Sales and redemptions                                                   116,380       10,305
          Principal collected                                                      50,402       68,250
          Purchases                                                               (11,034)     (39,585)
     Purchases of Federal Home Loan Bank of New York stock, net                      (188)      (5,047)
     Net addition to banking premises and equipment                                  (322)        (678)
     Proceeds from sales of other real estate owned                                   444          377
     Cash and cash equivalents acquired in South Jersey Financial
          Corporation, Inc. acquisition, net                                       13,382            -
                                                                                ---------    ---------
             Net cash provided by/(used in) investing activities                    1,526     (171,454)

Cash flows from financing activities:
     Net increase in deposits                                                      61,005       57,858
     Decrease in securities sold under repurchase agreements                            -      (79,000)
     Net (decrease)/increase in borrowings from the Federal Home Loan Bank         (8,500)     182,700
     Cash dividends paid on common stock                                           (8,313)      (6,682)
     Net proceeds from issuance of common stock upon exercise
          of stock options                                                            294          117
     Purchase of treasury shares                                                  (26,913)     (23,897)
                                                                                ---------    ---------
             Net cash provided by financing activities                             17,573      131,096
                                                                                ---------    ---------
     Net increase/(decrease) in cash and cash equivalents                          40,712      (25,195)
     Cash and cash equivalents at beginning of period                              47,684       73,548
                                                                                ---------    ---------
     Cash and cash equivalents at end of period                                 $  88,396    $  48,353
                                                                                =========    =========
Supplemental disclosure of cash flow information:
Cash paid during the year for:
     Interest on deposits and borrowed funds                                    $  58,900    $  46,984
     Income taxes                                                                   7,145       11,368

Non-cash investing activities:
     Securitization of mortgage loans                                           $  61,690    $       -
     Additions to other real estate owned, net                                        106            -
</TABLE>

      See accompanying notes to unaudited consolidated financial statements.

<PAGE>7

                      RICHMOND COUNTY FINANCIAL CORP. AND SUBSIDIARY
                   NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

1. Basis of Presentation
   ---------------------

The  accompanying   unaudited  consolidated  financial  statements  include  the
accounts  of  Richmond  County  Financial  Corp.  (the  "Company"),  its  direct
wholly-owned  subsidiary,  Richmond  County  Savings Bank (the "Bank"),  and the
subsidiaries of the Bank.

The unaudited  consolidated  financial  statements  included  herein reflect all
normal recurring adjustments which are, in the opinion of management,  necessary
for a fair  presentation of the results for the interim periods  presented.  The
results of operations  for the six month  period ended December 31, 2000 are not
necessarily indicative of the results of operations that may be expected for the
entire fiscal year. Certain  information and note disclosures  normally included
in the financial  statements,  prepared in accordance  with  generally  accepted
accounting principles,  have been condensed or omitted pursuant to the rules and
regulations of the Securities and Exchange Commission (the "SEC"). The unaudited
consolidated financial statements should be read in conjunction with the audited
consolidated  financial  statements and notes thereto  included in the Company's
2000 Annual Report and Form 10-K.

2. Earnings Per Share
   ------------------

Basic  earnings per share  ("EPS") is  calculated  by dividing net income by the
weighted average number of common shares outstanding.  Diluted EPS is calculated
using the same method as basic EPS,  but reflects  potential  dilution of common
stock  equivalents.  Shares of common  stock held by the ESOP that have not been
allocated  to  participants'  accounts or are not  committed  to be released for
allocation and non-vested  1998 Management  Recognition  Plan (the "MRP") shares
are not considered to be outstanding for the calculation of basic EPS,  however,
a portion of such shares are  considered  in the  calculation  of diluted EPS as
common stock equivalents of basic EPS. Basic and diluted weighted-average common
shares outstanding were 23,975,930 and 24,688,426 shares, for the second quarter
ended  December 31, 2000,  respectively.  For the six months ended  December 31,
2000,  basic  and  diluted  weighted  average  common  shares  outstanding  were
24,238,173 and 24,849,274 shares, respectively.

3. Conversion to Stock Form of Ownership
   -------------------------------------

On July 31, 1997, the Board of Trustees of the Bank  unanimously  adopted a Plan
of  Conversion  whereby the Bank would  convert from a New York State  chartered
mutual bank to a New York State chartered stock  institution with the concurrent
formation  of  a  holding   company,   Richmond  County   Financial  Corp.  (the
"Conversion").

The  Conversion  was  completed on February  18, 1998,  with the issuance by the
Company of 24,466,250 shares of common stock, at a price of $10.00 per share, in
an initial  public  offering.  The  Company  received  gross  proceeds  from the
Conversion of $244.7  million,  before the reduction from gross proceeds of $9.8
million for  estimated  conversion  related  expenses.  The Company  used $117.4
million, or 50% of the net proceeds, to purchase all of the outstanding stock of
the Bank.

Concurrent with the completion of the Conversion, an additional 1,957,300 shares
of  authorized  but  unissued  shares of common  stock were  contributed  by the
Company to the Richmond County Savings Foundation (the "Foundation"),  a private
foundation  dedicated to charitable  purposes

<PAGE>8

within the Bank's  communities  that it serves.  The Company recorded a one-time
charge  of  $19.6  million,  the full  amount  of the  contribution  made to the
Foundation  and a  corresponding  deferred tax benefit of $8.4  million,  in the
third quarter ended March 31, 1998. The  contribution  to the Foundation will be
fully tax deductible,  subject to an annual  limitation based upon the Company's
annual taxable income.

4. Recent Developments
   -------------------

On  January  23,  2001,  the  Company  announced  that the  Board  of  Directors
authorized the Company's  eighth stock  repurchase plan. The plan authorizes the
Company to  repurchase  1,305,963  shares,  or 5% of the  Company's  outstanding
common stock.  The eighth stock  repurchase  plan is expected to commence  after
February 18, 2001, the third anniversary of the Bank's conversion to stock form,
concurrent  with the  completion of the Company's  current  purchase  program of
which approximately 640,000 shares remain as of December 31, 2000.

The repurchases  will be made in unsolicited  purchases  pursuant to the federal
securities laws relating to activities by issuers having a distribution, subject
to the  availability of stock,  acceptable  pricing of the stock and such timing
limitations as may be applicable.

Additionally,  on January  23,  2001,  the Company  announced  that its Board of
Directors  declared a quarterly  cash  dividend of  eighteen  cents  ($0.18) per
common share.  The dividend will be payable on February 26, 2001 to shareholders
of record as of February 6, 2001.

<PAGE>9

ITEM 2. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

General

Richmond County Financial Corp. is a savings and loan holding company  regulated
by the  Office  of Thrift  Supervision.  The  primary  operating  subsidiary  of
Richmond County Financial Corp. is Richmond County Savings Bank (the "Bank"),  a
New York State chartered stock savings bank.  While the following  discussion of
financial condition and results of operations includes the collective results of
Richmond County Financial Corp. and the Bank (collectively the "Company"),  this
discussion  reflects the Bank's  activities  as the Company  currently  does not
engage in any significant  business  activities other than the management of the
Bank  and the  investment  of net  proceeds  from  the  Bank's  mutual  to stock
conversion, which occurred on February 18, 1998 (the "Conversion").

South Jersey Financial Corporation, Inc.

At the close of business on July 31, 2000, the Company completed its acquisition
of South  Jersey  Financial  Corporation,  Inc.  ("South  Jersey"),  the holding
company of South  Jersey  Savings  and Loan  Association,  a  community  savings
association  which operates three full service banking offices in the New Jersey
counties of Gloucester and Camden in a transaction  which was accounted for as a
purchase.  The cost of the acquisition was approximately $68.0 million for which
South Jersey  shareholders  received $20 per share in cash for each  outstanding
share of common stock of South Jersey. The excess of cost over the fair value of
net assets acquired ("goodwill") in the transaction was $28.0 million,  which is
being amortized on a straight-line basis over 20 years.

Bayonne Bancshares, Inc.

At the  close  of  business  on  March  22,  1999,  the  Company  completed  its
acquisition of Bayonne  Bancshares,  Inc.  ("Bayonne"),  the holding  company of
First Savings Bank of New Jersey,  SLA, a New Jersey State chartered savings and
loan association with four full service banking offices located in Bayonne,  New
Jersey in a transaction  which was accounted for as a purchase.  The cost of the
acquisition was  approximately  $118.5 million for which the Company issued 1.05
shares of its common stock for each  outstanding  share of Bayonne  common stock
for a total of 8,668,615  common shares,  of which 3,938,731  shares were issued
from its treasury  shares.  Options to purchase 683,577 shares of Bayonne common
stock  were also  converted  into  options  to  purchase  717,755  shares of the
Company's common stock.  The goodwill  attributable to the transaction was $28.8
million, which is being amortized on a straight-line basis over 15 years.

Ironbound Bankcorp, NJ.

At the close of business on March 5, 1999, the Company completed its acquisition
of Ironbound Bankcorp, NJ ("Ironbound"),  the holding company of Ironbound Bank,
a New  Jersey  chartered  commercial  bank with three  full  service  commercial
banking  offices  located in the New Jersey  counties  of Union and Essex,  in a
transaction  which was accounted for as a purchase.  The cost of the acquisition
was approximately  $27.7 million.  The Company issued 1.463 shares of its common
stock  for each  outstanding  share of  Ironbound  common  stock  for a total of
1,458,842 common shares. The goodwill  attributable to the transaction was $15.3
million, which is being amortized on a straight-line basis over 15 years.

<PAGE>10

Financial Condition

Total assets increased by $331.8 million,  or 11.5%, to $3.2 billion at December
31, 2000 from June 30, 2000. The increase in overall assets was primarily due to
the completion of the South Jersey acquisition with and into the Bank. As of the
acquisition date, South Jersey had total assets of approximately $314.7 million,
total deposits of $240.9 million and total equity of $47.7 million.

The Bank continues to experience increased loan growth. For the six month period
ended December 31, 2000, gross loans receivable  increased by $247.2 million, or
15.6%, on a non-annualized  basis, to $1.8 billion,  compared to $1.6 billion at
June 30, 2000. The increase in gross loans was due primarily to  originations of
$266.7 million generated during the six month period ended December 31, 2000 and
$142.3 million of loans acquired through the acquisition of South Jersey, offset
by  the  sale  of  $3.1  million  of  one-  to   four-family   mortgage   loans,
securitization  of $61.7  million  acquired  South  Jersey  one- to  four-family
mortgage loans and net amortization and prepayments of $97.0 million. During the
first half of fiscal 2001 and in conjunction with the South Jersey  acquisition,
the Bank securitized $61.7 million of one-to four-family mortgage loans acquired
from the  South  Jersey  acquisition  in  exchange  for a like  amount  of FHLMC
pass-through  securities,  recorded  these  securities in the Bank's  securities
portfolio and retained the related servicing  rights.  Loan originations for the
six month period ended December 31, 2000 were primarily comprised of multifamily
and one- to four-family  mortgage loans.  Multifamily mortgage loan originations
during the first half of fiscal 2001 totaled $113.1 million,  bringing the total
multifamily loan portfolio to $631.9 million,  or 34.7% of net loans at December
31, 2000. Total one- to four-family loan production for the first half of fiscal
2001 was $118.1 million.

Mortgage-backed and  mortgage-related  securities  increased by $5.6 million, or
0.7%,  from $764.6  million at June 30, 2000 to $770.2  million at December  31,
2000.  The increase in  mortgage-backed  and  mortgage-related  securities  were
primarily  the  result of the  aforementioned  securitization  of $61.7  million
acquired South Jersey one- to four-family mortgage loans into FHLMC pass-through
securities,  as well as $70.0 million of  mortgage-backed  and  mortgage-related
securities  acquired  from the South Jersey  acquisition,  offset in part by the
sale of $116.4 million of mortgage-backed  and  mortgage-related  securities and
net amortization and prepayments of $52.0 million.

Investment  securities at December 31, 2000 totaled $268.3 million,  an increase
of $10.8 million, or 4.2%, compared to $257.5 million at June 30, 2000.

Total liabilities at December 31, 2000 were $2.9 billion,  an increase of $323.0
million,  or 12.5%, from $2.6 billion at June 30, 2000. Total deposits increased
by $303.3  million,  or 16.9%,  to $2.1 billion at December 31, 2000. The Bank's
core deposits  increased by $122.4  million,  or 11.2%,  at December 31, 2000 to
$1.2 billion.  The increase in the Bank's core deposits were  attributable  to a
$17.2 million increase in total demand deposits and a $105.1 million increase in
savings, N.O.W. and money market accounts. The Bank also experienced an increase
of $181.0  million,  or 26.1%, in certificates of deposit from $693.3 million at
June 30, 2000 to $874.2  million at December 31,  2000.  The increase in overall
deposits  was   primarily  the  result of $240.9  million of  deposits  acquired
through the South Jersey  acquisition and an increase in certificates of deposit
which  was  primarily  attributable  to  increased  marketing  of  such  deposit
products.

Additionally, the Bank continues to place a level of emphasis on the utilization
of borrowed

<PAGE>11

funds to fund asset  growth.  In this regard,  at December 31, 2000 and June 30,
2000,  the Bank had total  borrowings  of $791.0  million  and  $773.7  million,
respectively.  In  connection  with the South  Jersey  acquisition,  the Company
acquired $27.6 million of borrowed funds. The Bank may continue to increase such
emphasis,  which may result in an increase in the Bank's  overall cost of funds.
The Bank's  current  strategy  is to invest such  borrowed  funds  primarily  in
mortgage loans and mortgage-backed and mortgage-related  securities with similar
estimated  maturities.  This strategy is intended to incrementally  increase net
interest income, although it may have the effect of incrementally decreasing net
interest rate spread.

Total  stockholders'  equity  increased  by $8.8  million  to $315.3  million at
December 31, 2000 from $306.4 million at June 30, 2000. The overall increase was
primarily due to earnings  reported for the six month  period ended December 31,
2000 of $19.0  million,  $22.1 million  increase in the fair value on securities
available  for sale,  net of tax and the  amortization  of $2.6  million for the
unallocated   and  unearned  shares  of  common  stock  held  by  the  Company's
stock-related  benefit  plans.  These  increases  were  offset,  in  part by the
repurchase of 1.3 million shares of the Company's  common stock and year to date
cash dividends paid of $8.3 million.

Non-performing Assets

Non-performing  loans totaled $10.9 million,  or 0.6% of total loans at December
31, 2000, as compared to $4.7 million, or 0.3% of total loans, at June 30, 2000.
At December 31,  2000,  the Bank's real estate  owned  consisted  of  foreclosed
assets  totaling  $106,000,  which  at such  date was  comprised  of two one- to
four-family properties.

At  December  31,  2000,  the Bank had $3.6  million  of  assets  designated  as
"Substandard,"  consisting of 27 loans, no assets  classified as "Doubtful," and
six consumer loans classified as "Loss," respectively.

Non-accrual  loans totaled $10.9 million as of December 31, 2000, which included
57 one- to four-family  loans,  with an aggregate  balance of $5.4 million,  and
nine  non-residential  loans  totaling $2.0  million,  nine  construction  loans
totaling $2.7 million and four commercial loans totaling $800,000.

For the six month  periods ended  December 31, 2000 and 1999, the Company's loan
loss provision remained unchanged at $600,000.  The Company's allowance for loan
losses  totaled $18.7 million at December 31, 2000 and $14.7 million at June 30,
2000,  which  represents a ratio of allowance for loan losses to  non-performing
loans of 171.8% and 311.5%, respectively.  The Company continues to increase its
overall loan loss reserves due to the increase in lending of all loan  products.
Management  believes  the  allowance  for loan  losses at  December  31, 2000 is
adequate and  sufficient  reserves are presently  maintained to cover  potential
losses.   For  the  six month  period  ended  December  31,  2000,  the  Company
experienced net charge-offs of $88,000.

Comparison of Operating Results for the Three Months Ended December 31, 2000 and
1999

General.  The Company  reported net income for the second quarter ended December
31, 2000 of $9.6 million, or diluted earnings per share of $0.39, an increase of
18.2% as compared to the $9.0 million,  or diluted  earnings per share of $0.33,
reported for the same period last year.

Interest Income. The Company reported total interest income of $56.4 million for
the second

<PAGE>12

quarter ended December 31, 2000,  representing  an increase of $7.9 million,  or
16.3%,  as compared to the same period in 1999. The increase in interest  income
was attributable primarily to the growth in average  interest-earning  assets of
$299.5  million  and  a  35  basis  point  increase  in  the  average  yield  on
interest-earning  assets. The overall increase in the level of  interest-earning
assets was  primarily  the result of an increase in assets  acquired  from South
Jersey, as well as deposit inflows.

Interest income on loans increased $7.0 million,  or 25.0%, to $35.0 million for
the second  quarter  ended  December 31, 2000,  as compared to the $28.0 million
reported  for the  comparable  period in 1999.  This  increase was the result of
growth in the  average  balance  of loans  outstanding  of $314.7  million,  due
primarily to increased  originations of multifamily and one- to four-family real
estate loans and loans acquired through the recently completed acquisition,  and
an increase in the average yield on the overall loan  portfolio to 7.81% for the
second quarter ended December 31, 2000, as compared to 7.57% for the same period
in 1999.

Interest income on debt and equity securities increased $527,000,  or 8.3%, from
$6.4 million for the second quarter ended December 31, 1999, to $6.9 million for
the same period in 2000.  This increase is mainly  attributable to the growth in
the average  balance of debt and equity  securities,  primarily  investments  in
financial  bonds and FHLB  stock,  as well as a 55 basis  point  increase in the
average yield on the debt and equity portfolio.

Interest income on mortgage-backed  and  mortgage-related  securities  increased
$271,000,  or 1.9%,  from $14.0  million  reported for the second  quarter ended
December 31, 1999, to $14.3  million for the same period in 2000.  This increase
was due primarily to an increase in the average yield on the mortgage-backed and
mortgage-related  securities  portfolio  to 6.81% for the second  quarter  ended
December 31, 2000, as compared to 6.50% for the same period in 1999.

Interest Expense.  Interest expense increased $6.0 million, or 24.7%, from $24.2
million for the second quarter ended December 31, 1999, to $30.2 million for the
second  quarter  ended  December  31,  2000.  The  average  cost  of the  Bank's
interest-bearing  liabilities  increased from 4.18% for the second quarter ended
December  31, 1999,  to 4.49% for the second  quarter  ended  December 31, 2000.
Interest  expense on  deposits  increased  $5.9  million,  or 43.6%,  from $13.4
million for the second quarter ended December 31, 1999, to $19.3 million for the
second quarter ended  December 31, 2000. The increase  reflects a $372.4 million
increase  in  the  average  balance  of  interest-bearing  deposits,   primarily
attributable to a $242.6 million increase in the average balance of certificates
of deposit and a $129.8 million increase in the average balance of money market,
savings and N.O.W. deposit accounts. This increase can be primarily attributable
to deposits acquired through the recently completed South Jersey acquisition. In
addition,  the Bank's  strategy  over the past several years has been to attract
more  certificates of deposit through the offering of additional  certificate of
deposit products and related marketing of commercial deposit accounts.

Interest  expense on borrowed  funds for the quarter ended December 31, 2000 was
$10.9 million, an increase of $132,000 as compared to the $10.8 million reported
in the same period in 1999.  The increase in interest  expense on borrowed funds
was  attributable  to a 10 basis point  increase in the average cost on borrowed
funds,  offset in part by a decrease in the average balance of borrowed funds of
$7.7  million.  The Bank  continues to place a greater  level of emphasis on the
utilization  of borrowed  funds to fund asset  growth and to leverage the Bank's
capital position to improve returns on equity. As of December 31, 2000, the Bank
had $791.0 million of borrowings  outstanding,  an increase of $17.3 million, or
2.2%, as compared to the $773.7 million of borrowings outstanding as of June 30,
2000. The Bank may continue to increase such

<PAGE>13

emphasis  on  borrowed  funds,  which may  result in an  increase  in the Bank's
overall cost of funds.  The Bank's  current  strategy is to invest such borrowed
funds  primarily  in  mortgage-backed  and  mortgage-related   securities.  This
strategy is intended to incrementally increase net interest income,  although it
may have the effect of incrementally decreasing net interest rate spread.

Provision  for  Loan  Losses.  The  Bank's  provision  for loan  losses  for the
three month  periods  ended  December  31,  2000 and  1999  were  $300,000.  The
provision  for  the  second  quarter  ended  December  31,  2000  was  based  on
management's evaluation of its loan portfolio and real estate market conditions.
In particular,  management considered the continued growth in the portfolio, the
introduction  of new lending  products by the Bank and the seasoning of such new
products, as well as the level of its non-performing loans. Management believes,
based upon information  currently available,  that its allowance for loan losses
is adequate to cover future loan losses.  To the extent the Bank  increases  its
investment in multifamily  loans,  commercial real estate,  commercial and other
loans,  which entail higher risk than one- to  four-family  loans,  the Bank may
decide to increase its allowance for loan losses  through  additional  loan loss
provisions,  which may  adversely  affect net income.  In  addition,  if general
economic  conditions  and real estate values within the Bank's  primary  lending
area  decline,  the level of  non-performing  loans may  increase,  resulting in
larger  provisions for loan losses which, in turn,  would also adversely  affect
net income.

Non-Interest  Income.  Exclusive  of net  gains  and  losses  from the  sales of
securities  and loans,  total  non-interest  income for the second quarter ended
December 31, 2000 was $4.0 million, as compared to the $3.5 million reported for
the same period in 1999. The increased level of non-interest income is primarily
due to an overall  increase in deposit fee income,  loan  prepayment  fees,  fee
income generated from the South Jersey acquisition, and advisory fee income from
our investment in Peter B. Cannell & Co. Inc.

Non-Interest Expense.  Non-interest expense totaled $15.0 million for the second
quarter  ended  December 31, 2000,  an increase of $1.8  million,  or 13.8%,  as
compared to the $13.2  million  reported  for the same period of the prior year.
The increased level of non-interest expense was mainly attributable to increased
compensation  and employee  benefit  expenses,  goodwill  amortization and other
expenses associated with the South Jersey acquisition.

Income  Taxes.  The  Company's  effective  consolidated  tax rate for the second
quarter ended December 31, 2000, was 35.8% as compared to 36.5% reported for the
comparable period in 1999. The reduction of the Company's  effective tax rate is
primarily due to the Bank's utilization of various tax-planning strategies.

Comparison of Operating  Results for the Six Months Ended  December 31, 2000 and
1999

General. The Company reported net income for the six month period ended December
31, 2000 of $19.0 million,  or diluted  earnings per share of $0.76, an increase
of 20.6% as compared  with $0.63 core  earnings per share  reported for the same
period last year. Core earnings for the six-month period ended December 31, 1999
excludes net gains on sales of securities and loans of $710,000.

Interest  Income.  The Company  reported total interest income of $110.4 million
for the six month period ended  December 31, 2000,  representing  an increase of
$15.2 million, or 16.0%, as compared to the same period in 1999. The increase in
interest   income  was   attributable   primarily   to  the  growth  in  average
interest-earning  assets of $285.4  million and a 34 basis point increase in the
average yield on  interest-earning  assets. The overall increase in the level of
interest-earning

<PAGE>14

assets was  primarily  the result of an increase in assets  acquired  from South
Jersey, as well as deposit inflows.

Interest income on loans increased $14.4 million, or 26.7%, to $68.5 million for
the six month period ended  December 31, 2000,  as compared to the $54.1 million
reported  for the  comparable  period in 1999.  This  increase was the result of
growth in the  average  balance  of loans  outstanding  of $337.5  million,  due
primarily to increased  originations of multifamily and one- to four-family real
estate loans and loans acquired through the recently completed  acquisition,  as
well as an increase in the average yield on the overall loan  portfolio to 7.78%
for the six month period ended  December 31, 2000,  as compared to 7.60% for the
same period in fiscal 1999.

Interest income on debt and equity securities increased $931,000,  or 7.4%, from
$12.6 million for the six month period ended December 31, 1999, to $13.5 million
for the same period in 2000. This increase is mainly  attributable to the growth
in the average balance of debt and equity securities,  primarily  investments in
financial  bonds and FHLB  stock,  as well as a 75 basis  point  increase in the
average yield on the debt and equity portfolio.

Interest income on mortgage-backed  and  mortgage-related  securities  decreased
$277,000,  or 1.0%, from $28.3 million  reported for the six month  period ended
December 31, 1999, to $28.0  million for the same period in 2000.  This decrease
was due primarily to a decrease in the average  balance of  mortgage-backed  and
mortgage-related  securities of $48.1 million,  offset in part by an increase in
the  average  yield  on  the  mortgage-backed  and  mortgage-related  securities
portfolio to 6.79% for the six month period ended December 31, 2000, as compared
to 6.47% for the same period in 1999.

Interest Expense. Interest expense increased $11.3 million, or 23.8%, from $47.3
million for the six month  period ended  December 31, 1999, to $58.6 million for
the  six month  period ended  December 31, 2000.  The average cost of the Bank's
interest-bearing liabilities increased from 4.14% for the six month period ended
December 31, 1999,  to 4.49% for the six-month  period ended  December 31, 2000.
Interest  expense on deposits  increased  $11.1  million,  or 42.7%,  from $25.9
million for the six month  period ended  December 31, 1999, to $37.0 million for
the six month  period ended  December 31, 2000.  The increase  reflects a $329.6
million increase in the average balance of interest-bearing deposits,  primarily
attributable to a $218.5 million increase in the average balance of certificates
of deposit and a $111.1 million increase in the average balance of money market,
savings and N.O.W. deposit accounts. This increase can be primarily attributable
to deposits acquired through the recently completed South Jersey acquisition. In
addition,  the Bank's  strategy  over the past several years has been to attract
more  certificates of deposit through the offering of additional  certificate of
deposit products and related marketing of commercial deposit accounts.

Interest  expense on borrowed funds for the six month  period ended December 31,
2000 was $21.6 million, an increase of $229,000 as compared to the $21.4 million
reported  in the same  period in 1999.  The  increase  in  interest  expense  on
borrowed funds was  attributable  to a seven basis point increase in the average
cost on borrowed  funds,  offset in part by a decease in the average  balance of
borrowed  funds of $4.3 million.  The Bank continues to place a greater level of
emphasis  on the  utilization  of  borrowed  funds to fund  asset  growth and to
leverage  the  Bank's  capital  position  to improve  returns  on equity.  As of
December 31, 2000,  the Bank had $791.0  million of borrowings  outstanding,  an
increase  of $17.3  million,  or 2.2%,  as  compared  to the  $773.7  million of
borrowings  outstanding  as of June 30, 2000.  The Bank may continue to increase
such emphasis on borrowed  funds,  which may result in an increase in the Bank's
overall cost of funds.  The Bank's  current  strategy is to invest such borrowed
funds primarily in

<PAGE>15

mortgage-backed and  mortgage-related  securities.  This strategy is intended to
incrementally  increase net interest income,  although it may have the effect of
incrementally decreasing net interest rate spread.

Provision  for  Loan  Losses.  The  Bank's  provision  for loan  losses  for the
six month periods ended December 31, 2000 and 1999 were $600,000.  The provision
for the  six month  period  ended  December  31, 2000 was based on  management's
evaluation  of  its  loan  portfolio  and  real  estate  market  conditions.  In
particular,  management  considered the continued  growth in the portfolio,  the
introduction  of new lending  products by the Bank and the seasoning of such new
products, as well as the level of its non-performing loans. Management believes,
based upon information  currently available,  that its allowance for loan losses
is adequate to cover future loan losses.  To the extent the Bank  increases  its
investment in multifamily  loans,  commercial real estate,  commercial and other
loans,  which entail higher risk than one- to  four-family  loans,  the Bank may
decide to increase its allowance for loan losses  through  additional  loan loss
provisions,  which may  adversely  affect net income.  In  addition,  if general
economic  conditions  and real estate values within the Bank's  primary  lending
area  decline,  the level of  non-performing  loans may  increase,  resulting in
larger  provisions for loan losses which, in turn,  would also adversely  affect
net income.

Non-Interest  Income.  Exclusive  of net  gains  and  losses  from the  sales of
securities and loans, total  non-interest  income for the six month period ended
December 31, 2000 was $7.5 million, as compared to the $6.7 million reported for
the same period in 1999. The increased level of non-interest income is primarily
due to an overall  increase in deposit fee income,  loan  prepayment  fees,  fee
income generated from the South Jersey acquisition, and advisory fee income from
our  investment  in Peter B.  Cannell  & Co.  Inc.  Net gains  reported  for the
six month  period ended  December 31, 1999,  were  primarily due to net gains of
$710,000 from the sale of equity and investment securities.

Non-Interest  Expense.  Non-interest  expense  totaled  $29.1  million  for  the
six-month period ended December 31, 2000, an increase of $3.1 million, or 11.8%,
as compared to the $26.1 million reported for the same period of the prior year.
The increased level of non-interest expense was mainly attributable to increased
compensation  and employee  benefit  expenses,  goodwill  amortization and other
expenses associated with the South Jersey acquisition.

Income taxes.  The Company's  effective  consolidated tax rate for the six month
period ended  December 31, 2000, was 35.9% as compared to 36.5% reported for the
comparable period in 1999. The reduction of the Company's  effective tax rate is
primarily due to the Bank's utilization of various tax-planning strategies.

Liquidity and Capital Resources

The Bank's  primary  sources of funds are deposits,  proceeds from the principal
and  interest  payments  on  loans,  mortgage-backed  and  mortgage-related  and
investment securities,  and to a significantly lesser extent,  proceeds from the
sale of fixed-rate mortgage loans to the secondary market.  While maturities and
scheduled amortization of loans and securities are predictable sources of funds,
deposit  outflows,  mortgage  prepayments  and  mortgage  loan sales are greatly
influenced by general interest rates, economic conditions and competition.

The primary investing  activities of the Bank are the origination of residential
one- to  four-family,  multifamily  and,  to a lesser  extent,  commercial  real
estate,  construction  and  development  and  other  loans and the  purchase  of
mortgage-backed  and  mortgage-related  and  investment  securities.

<PAGE>16

During the six month periods ended  December 31, 2000 and 1999,  the Bank's loan
originations totaled $266.7 million and $342.3 million, respectively.  Purchases
of  mortgage-backed,  mortgage-related  and investment  securities totaled $38.4
million and $81.4 million for the six month  periods ended December 31, 2000 and
1999, respectively. These activities were funded primarily by deposit growth and
principal   repayments   and   prepayments   on   loans,   mortgage-backed   and
mortgage-related  securities  and  investment  securities  and advances from the
FHLB.  As of December 31,  2000,  the Bank  experienced  a net increase in total
deposits of $303.3  million to $2.1 billion,  or 16.9%,  as compared to the $1.8
billion at June 30,  2000.  Deposit  flows are affected by the level of interest
rates, products offered by local competitors and other factors.

The Bank  closely  monitors  its  liquidity  position on a daily  basis.  Excess
short-term  liquidity is invested in overnight  federal funds sold. In the event
the Bank should  require funds beyond its ability to generate  them  internally,
additional  sources of funds are available  through  repurchase  agreements  and
advances from the FHLB.  The Bank has recently begun to place a greater level of
emphasis on the  utilization  of borrowed  funds to fund asset  growth.  In this
regard,  at December 31, 2000, the Bank had total  borrowings of $791.0 million.
The Bank may continue to increase such emphasis, which may result in an increase
in the Bank's average cost of funds.

Loan commitments totaled $159.4 million at December 31, 2000, and were comprised
of $36.5  million  in one- to  four-family  loan  commitments,  $3.2  million in
commercial  real estate loan  commitments,  $60.8 million in  construction  loan
commitments, $16.3 million in commercial loan commitments, $23.5 million in home
equity loan commitments,  $14.4 million in multifamily loan commitments and $4.7
million in other loan  commitments.  In addition,  management  estimates that an
increased  level of loan  commitments  may arise as a result of the  Multifamily
Lending  Division.  Management  of  the  Bank  anticipates  that  it  will  have
sufficient funds available to meet its current loan commitments. Certificates of
deposit,  which are  scheduled to mature in less than one year from December 31,
2000, totaled $684.2 million.  Based upon past experience and the Bank's current
pricing  strategy,  management  believes  that a  significant  portion  of  such
deposits will remain with the Bank.

At  December  31,  2000,  the  Bank  exceeded  all  of  its  regulatory  capital
requirements  with a  leveraged capital  level  of  $231.9  million,  or 7.3% of
adjusted assets, which is above the required level of $128.1 million, or 4.0% of
adjusted assets, and risk-based capital of $250.6 million,  or 14.1% of adjusted
assets,  which exceeds the required level of $142.0 million, or 8.0% of adjusted
assets.

The  Company's  most liquid  assets are cash,  due from banks and federal  funds
sold.  The  levels  of these  assets  are  dependent  on the  Bank's  operating,
financing, lending and investing activities during any given period. At December
31, 2000, cash, due from banks and federal funds sold totaled $88.4 million,  or
2.8% of total assets.

Forward-looking Statement

This Report on Form 10-Q contains certain forward-looking  statements within the
meaning of the federal securities laws. The Company intends such forward-looking
statements  to be  covered by the safe  harbor  provisions  for  forward-looking
statements  contained  in the  Private  Securities  Reform  Act of 1995,  and is
including  this  statement  for  purposes  of  these  safe  harbor   provisions.
Forward-looking statements,  which are based on certain assumptions and describe
future  plans,  strategies  and  expectations  of  the  Company,  are  generally
identified  by use of the words  "believe,"  "expect,"  "intend,"  "anticipate,"
"estimate," "project," or similar expressions.  The

<PAGE>17

Company's  ability to predict  results or the actual  effect of future  plans or
strategies is inherently uncertain.  Factors which could have a material adverse
effect on the operations of the Company and the  subsidiaries  include,  but are
not limited  to,  changes  in:  interest  rates,  general  economic  conditions,
legislative/regulatory  changes,  monetary  and  fiscal  policies  of  the  U.S.
Government,  including  policies of the U.S.  Treasury  and the Federal  Reserve
Board, the quality or composition of the loan or investment  portfolios,  demand
for loan products, deposit flows, competition,  demand for financial services in
the Company's market area and accounting principles and guidelines.  These risks
and uncertainties should be considered in evaluating  forward-looking statements
and undue reliance should not be placed on such statements.  Further information
concerning  the Company  and  its business,  including  additional  factors that
could  materially  affect the Company's  financial  results,  is included in the
Company's other filings with the SEC.

Readers are cautioned not to place undue reliance on forward-looking statements,
which speak only as of the date of the Report.  Except as required by applicable
law  or   regulation,   the  Company   undertakes   no   obligation   to  update
forward-looking  statements to reflect events that occur after the date on which
such statements have been made.

<PAGE>18

ITEM 3. QUANTITATIVE AND QUALITIVE DISCLOSURES ABOUT MARKET RISK

Asset and Liability Management and the Management of Interest Rate Risk

Quantitative  and qualitative  disclosure about market risk is presented at June
30, 2000 in Item 7a. to the Company's Form 10-K, filed with the SEC on September
28, 2000.  There have been no material  changes in the Company's  market risk at
December  31, 2000 as compared to June 30, 2000.  The  following is an update of
the discussion provided therein.

General. The Company's largest component of market risk continues to be interest
rate risk. Substantially all of this risk continues to reside at the Bank level.
The Bank still is not subject to foreign  currency  exchange or commodity  price
risk.  At December 31, 2000,  neither the Company nor the Bank owned any trading
assets,  nor did they  participate in hedging  programs,  interest rate swaps or
other activities  involving the use of off-balance  sheet  derivative  financial
instruments.

Gap Analysis.  At December 31, 2000,  the  Company's  estimated  one-year  "gap"
position, the difference between the amount of interest-earning  assets maturing
or  repricing  within  one year and  interest-bearing  liabilities  maturing  or
repricing  within  one year,  was a  negative  $599.0  million,  representing  a
one-year  interest  sensitivity  gap as a percentage of total assets of (18.7%).
Accordingly,  during a period of rising  interest rates,  the Company,  having a
positive  gap  position,  would be in a better  position  to  invest  in  higher
yielding  assets  which,  consequently,  may  result in the yield on its  assets
increasing  at a pace more  closely  matching  the  increase  in the cost of its
interest-bearing  liabilities  than if it had a negative gap. During a period of
falling  interest rates,  an institution  with a positive gap would tend to have
its  assets  repricing  at a faster  rate than one with a  negative  gap  which,
consequently,  may tend to  restrain  the growth of its net  interest  income or
result in a decrease in interest income.

Interest Rate Risk  Compliance.  The Company  continues to monitor the impact of
interest rate volatility upon net interest income and net portfolio value in the
same  manner as at June 30, 2000. There  have  been no  changes  in the Board of
Directors' approved limits of acceptable variance in net interest income and net
portfolio  value at  December  31,  2000,  compared  to June 30,  2000,  and the
projected  changes  continue  to fall  within the Board of  Directors'  approved
limits at all levels of potential interest rate volatility.

<PAGE>19

                           PART II - OTHER INFORMATION

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

The  Company is not  involved in any pending  legal  proceedings  other than the
routine  legal  proceedings  occurring in the ordinary  cause 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.

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
--------------------------------------------------------------
           Not applicable.

ITEM 5.    OTHER INFORMATION
----------------------------
           Not applicable.

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

(a) Exhibits

       3.1  Certificate of Incorporation of Richmond County Financial Corp.*
       3.2  Bylaws of Richmond County Financial Corp.*
      10.1  Form of Richmond County Savings Bank Employee Stock Ownership Plan
            and Trust.*
      10.2  Form of ESOP Loan Commitment Letter and ESOP Loan Documents.*
      10.13 Form of Proposed Richmond County Savings Bank Employee Severance
            Compensation Plan.*
      10.14 Richmond County  Financial Corp. Supplemental Executive Retirement
            Plan (As Amended and Restated).***
      10.15 Richmond County Financial Corp. 1998 Stock-Based Incentive Plan.**
      11.0  Statement re: Computation of Per Share Earnings.

      *     Incorporated by reference from the Form S-1 (Registration No.
            333-37009), as amended, filed on October 2, 1997.

      **    Incorporated by reference from the DEF 14A (File No. 0-23271), filed
            with the SEC on August 28, 1998.

      ***   Incorporated  by  reference  from the Form 10-K (File No.  0-23271),
            filed with the SEC on September 28, 1999.

(b)   Reports on Form 8-K
      -------------------
      Not applicable.

<PAGE>20

                                  Exhibit Index

Exhibit No.                                                                Page

11.0    Statement re:  Computation of Per Share Earnings................    22

<PAGE>21

                                    SIGNATURE

      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.

                         RICHMOND COUNTY FINANCIAL CORP.

                                  (Registrant)

Date:      February 13, 2001         By:    /s/ Michael F. Manzulli
                                            ----------------------------
                                                Michael F. Manzulli
                                                Chairman of the Board and
                                                Chief Executive Officer


Date:      February 13, 2001         By:    /s/ Thomas R. Cangemi
                                            ----------------------------
                                                Thomas R. Cangemi
                                                Executive Vice President, Chief
                                                Financial Officer and Treasurer