UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                    FORM 10-Q

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

                  For the quarterly period ended June 30, 2001
                                       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 1-13691

                             Bay State Bancorp, Inc.
             (Exact name of registrant as specified in its charter)

           Delaware                                               04-3398630
(State or other jurisdiction of                               (I.R.S. Employer
 Incorporation or organization)                              Identification No.)

1299 Beacon Street, Brookline, Massachusetts                        02446
  (Address of principal executive offices)                        (Zip Code)

       Registrant's telephone number, including area code: (617) 739-9500

     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  preceeding  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.|X| Yes   |_| No

     The number of shares of common  stock  outstanding  of each of the issuer's
classes of common stock, as of August 13, 2001 was 1,757,717.


<PAGE>


                    BAY STATE BANCORP, INC. AND SUBSIDIARIES

                                      INDEX


PART I - FINANCIAL INFORMATION.................................................1

  Item 1 - Condensed Consolidated Financial Statements.........................1

    Condensed Consolidated Balance Sheets - June 30, 2001
    (unaudited) and March 31, 2001.............................................1

    Condensed Consolidated Income Statements - For the three months
    ended June 30, 2001 and 2000 (unaudited) ..................................2

    Condensed Consolidated Statements of Cash Flows - For the
    three months ended June 30, 2001 and 2000  (unaudited) ....................3

    Condensed Consolidated Statements of Changes in Stockholders' Equity -
    For the three months ended June 30, 2001 and 2000 (unaudited) .............4

    Notes to Unaudited Condensed Consolidated Financial Statements
    for the Period Ended June 30, 2001.........................................5

  Item 2 - Management's Discussion and Analysis of Financial
    Condition and Results of Operations........................................7

  Item 3 - Quantitative and Qualitative Disclosures about Market Risk.........14


PART II - OTHER INFORMATION...................................................17

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

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

  Item 3 - Defaults Upon Senior Securities....................................17

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

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

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

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

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

    Computation of per share earnings - Exhibit 11............................19



<PAGE>


PART I - FINANCIAL INFORMATION
Item 1 - Condensed Financial Statements

                    Bay State Bancorp, Inc. and Subsidiaries
                      Condensed Consolidated Balance Sheets
                  (Dollars in thousands, except per share data)

<TABLE>
<CAPTION>
                                                                       June 30,      March 31,
                                                                         2001           2001
                                                                       ---------     ---------
                                                                      (Unaudited)
<S>                                                                    <C>           <C>
ASSETS

Cash and due from banks                                                $  10,260     $   9,985
Short-term investments                                                     4,715           114
                                                                       ---------     ---------
         Cash and Cash Equivalents                                        14,975        10,099
Investment in available-for-sale securities (at fair value)               34,293        34,356
Investments in held-to-maturity securities
  (fair values of $278 and $345)                                             269           336

Stock in Federal Home Loan Bank of Boston                                  8,455         8,455
Loans receivable, net                                                    419,704       417,704
Mortgage loans held for sale                                                 702          --
Accrued interest receivable                                                3,199         3,268
Premises and equipment, net                                                3,164         3,222
Deferred tax asset, net                                                    2,841         2,816
Investment in bank owned life insurance                                    8,360         8,269
Other assets                                                               3,437         3,332
                                                                       ---------     ---------
                Total assets                                           $ 499,399     $ 491,857
                                                                       =========     =========

LIABILITIES AND STOCKHOLDERS' EQUITY

Liabilities:
         Deposits                                                      $ 299,233     $ 273,263
         Federal Home Loan Bank Advances                                 138,698       158,139
         Other borrowed funds                                              2,000         2,000
         Accrued expenses and other liabilities                            5,297         4,695
                                                                       ---------     ---------
                 Total liabilities                                       445,228       438,097
                                                                       ---------     ---------

Stockholders' equity:
         Common stock, par value $.01 per share,
                 2,535,232 shares issued                                      25            25
         Additional paid-in capital                                       49,215        49,275
         Retained earnings                                                25,284        24,382
         Accumulated other comprehensive income                              549           617
            Less: Unearned ESOP shares                                    (2,420)       (2,420)
               Unearned 1998 Stock-Based Incentive Plan shares            (1,133)       (1,208)
                    Treasury stock, 782,539 and 769,689 shares           (17,349)      (16,911)
                                                                       ---------     ---------
                 Total stockholders' equity                               54,171        53,760
                                                                       ---------     ---------
                 Total liabilities and stockholders' equity            $ 499,399     $ 491,857
                                                                       =========     =========

Equity-to-asset ratio                                                      10.85%        10.93%

Book value per share                                                   $   33.29     $   32.77
</TABLE>

         The accompanying notes are an integral part of these condensed
                       consolidated financial statements.

                                     Page 1

<PAGE>


                    Bay State Bancorp, Inc. and Subsidiaries
                    Condensed Consolidated Income Statements
                  (Dollars in thousands, except per share data)

<TABLE>
<CAPTION>
                                                                                  Three months ended
                                                                                       June 30,
                                                                                       --------
                                                                                   2001         2000
                                                                                   ----         ----
                                                                                       Unaudited
                                                                                       ---------
<S>                                                                             <C>          <C>
Interest income:
   Loans                                                                        $    8,813   $     8,065
   Investments                                                                         746           696
                                                                                ----------   -----------
      Total interest income                                                          9,559         8,761
                                                                                ----------   -----------
Interest expense:
   Deposits                                                                          2,837         2,655
   Borrowed funds                                                                    2,239         2,277
                                                                                ----------   -----------
      Total interest expense                                                         5,076         4,932
                                                                                ----------   -----------
      Net interest income before provision for loan losses                           4,483         3,829
Provision for loan losses                                                               62           165
                                                                                ----------   -----------
      Net interest income after provision for loan losses                            4,421         3,664
                                                                                ----------   -----------
Non-interest income:
   Service charges on deposit accounts                                                 158           100
   Net gain (loss) on trading activities                                                69           (56)
   Gain on sale of loans, net                                                            8             3
   Net increase in cash surrender value of bank owned life insurance policies           92           104
   Other income                                                                         55            41
                                                                                ----------   -----------
      Total non-interest income                                                        382           192
                                                                                ----------   -----------
      Income before non-interest expense and income taxes                            4,803         3,856
                                                                                ----------   -----------
Non-interest expense:
   Salaries and employee benefits                                                    1,833         1,701
   Occupancy and equipment expense                                                     393           349
   Advertising                                                                         153           134
   Data processing                                                                     108            71
   Professional fees                                                                   111            68
   Other expenses                                                                      290           303
                                                                                ----------   -----------
      Total non-interest expense                                                     2,888         2,626
                                                                                ----------   -----------
      Income before income taxes                                                     1,915         1,230
Income tax expense                                                                     749           423
                                                                                ----------   -----------
      Net income                                                                $    1,166   $       807
                                                                                ==========   ===========
Comprehensive net income                                                        $    1,098   $     1,138
                                                                                ==========   ===========
Weighted average basic shares outstanding                                        1,633,733     1,810,744
                                                                                ==========   ===========
Weighted average fully diluted shares outstanding                                1,721,235     1,810,744
                                                                                ==========   ===========
Basic earnings per share                                                        $     0.71   $      0.45
                                                                                ==========   ===========
Diluted earnings per share                                                      $     0.68   $      0.45
                                                                                ==========   ===========
Dividends per share                                                             $     0.15   $      0.10
                                                                                ==========   ===========
</TABLE>


               The accompanying notesare an integral part of these
                  condensed consolidated financial statements.


                                       2
<PAGE>

                    Bay State Bancorp, Inc. and Subsidiaries
                 Condensed Consolidated Statements of Cash Flows
                                 (In thousands)

<TABLE>
<CAPTION>
                                                                                      Three months ended June 30,
                                                                                      ---------------------------
                                                                                           2001        2000
                                                                                           -----       ----
                                                                                               Unaudited
                                                                                               ---------
<S>                                                                                      <C>         <C>
Net cash flows from operating activities
           Net income                                                                    $  1,166    $    807
           Adjustments to reconcile net income to net cash provided by
             operating activities:
                 Earned stock based incentive plan                                             66          68
                 Provision for loan losses                                                     62         165
                 Net increase in mortgage loans held-for-sale                                (702)         --
                 Depreciation and amortization                                                115          97
                 Accretion of securities, net of amortization                                 (14)        (22)
                 Change in loan fees and discounts                                             45         (73)
                 Net (gain) loss on Trading activities                                        (65)         56
                 Increase in cash surrender value B.O.L.I                                     (91)       (105)
                 Decrease (increase) in accrued interest receivable                            69        (178)
                 Decrease in deferred income tax assets, net                                   18          98
                 Increase in prepaid expense and other assets                                 (40)        (35)
                 Increase in accrued expenses and other liabilities                           529         208
                                                                                         --------    --------
         Net cash provided by operating activities                                          1,158       1,086
                                                                                         --------    --------
Net cash flows from investing activities:
                 Maturities and principal repayments on investments held to maturity           67          52
                 Maturities and principal repayments on investments available for sale      2,191       3,463
                 Purchases of investments available for sale                               (2,152)     (1,086)
                 Net increase in loans                                                     (2,107)    (12,430)
                 Payment received on other real estate owned                                   --          20
                 Capital expenditures                                                         (57)       (242)
                                                                                         --------    --------
         Net cash used in investing activities                                             (2,058)    (10,223)
                                                                                         --------    --------
Net cash flows from financing activities:
                 Net deposit activity                                                      25,970      11,012
                 Proceeds of borrowings                                                    25,000      78,000
                 Repayment of borrowings                                                  (44,441)    (73,347)
                 Net decrease in other borrowed funds                                          --      (6,071)
                 Proceeds from issuance of common stock                                       118          --
                 Dividends on common stock                                                   (264)       (196)
                 Purchases of treasury stock                                                 (607)         --
                                                                                         --------    --------
                     Net cash provided by financing activities                              5,776       9,398
                                                                                         --------    --------
Net increase in cash and cash equivalents                                                   4,876         261
Cash and cash equivalents at beginning of period                                           10,099       5,992
                                                                                         --------    --------
Cash and cash equivalents at end of period                                               $ 14,975    $  6,253
                                                                                         ========    ========
Supplemental disclosure of cash flow information:
         Cash paid during period for:
                 Interest                                                                $  5,171    $  4,903
                 Income taxes                                                            $    466    $    173
</TABLE>


               The accompanying notesare an integral part of these
                  condensed consolidated financial statements.


                                       3
<PAGE>


                    Bay State Bancorp, Inc. and Subsidiaries
           Consolidated Statements of Changes in Stockholders' Equity
                  (Dollars in thousands, except per share data)
                                   (Unaudited)


<TABLE>
<CAPTION>

                                                                    Accumulated                Unearned
                                             Additional                Other                  Stock-based                Total
                                     Common   Paid-in    Retained  Comprehensive   Unearned  Incentive Plan Treasury  Stockholders'
                                      Stock   Capital    Earnings  Income (Loss)  ESOP Shares    Shares       Stock      Equity
                                    -----------------------------------------------------------------------------------------------
<S>                                    <C>   <C>         <C>          <C>          <C>          <C>         <C>         <C>
Balance at March 31, 2001              $25   $ 49,275    $ 25,382     $   617      $(2,420)     $(1,208)    $(16,911)   $ 53,760
  Net Income                            --         --       1,166          --           --           --           --          --
Net change in unrealized gain
  on available for sale
  securities, net of tax effect         --         --          --         (68)          --           --           --          --
   Comprehensive income                 --         --          --          --           --           --           --       1,098
Purchase of treasury stock,
  19,800 shares                         --         --          --          --           --           --         (607)       (607)
Exercise of stock options
  ssued from treasury stock             --        (51)         --          --           --           --          169         118
Dividends paid, $0.15 per share         --         --        (264)         --           --           --           --        (264)
Issuance of stock incentive
  plan shares                           --         (9)         --          --           --           75           --          66
                                    -----------------------------------------------------------------------------------------------
Balance at June 30, 2001 (Unaudited)   $25   $ 49,215    $ 25,284     $   549      $(2,420)     $(1,133)    $(17,349)   $ 54,171
                                    ===============================================================================================

                                    -----------------------------------------------------------------------------------------------
Balance at March 31, 2000              $25   $ 49,207    $ 21,600     $(1,788)     $(2,826)     $(1,681)    $(11,907)   $ 52,630
  Net Income                            --         --         807          --           --           --           --          --
Net change in unrealized loss
  on available for sale securities,
  net of tax effect                     --         --          --         331           --           --           --          --
Comprehensive income                    --         --          --          --           --           --           --       1,138
Dividends paid, $0.10 per share         --         --        (196)         --           --           --           --        (196)
Issuance of stock incentive
  plan shares                           --         (7)         --          --           --           75           --          68
                                    -----------------------------------------------------------------------------------------------
Balance at June 30, 2000 (Unaudited)   $25   $ 49,200    $ 22,211     $(1,457)     $(2,826)     $(1,606)    $(11,907)   $ 53,640
                                    ===============================================================================================
</TABLE>


              The accompanying notes are an integral part of these
                  condensed consolidated financial statements.


                                       4
<PAGE>

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                       FOR THE PERIOD ENDED June 30, 2001
                                   (Unaudited)

(1) Organization

     Bay State  Bancorp,  Inc. (the  "Company" or "Bay State") was  incorporated
under the laws of  Delaware  in October  1997 for the  purpose of serving as the
holding  company of Bay State  Federal  Bank (the  "Bank") as part of the Bank's
conversion   from  the  mutual  form  of  organization  to  the  stock  form  of
organization  (the  "Conversion").  The  Company is a savings  and loan  holding
company and is subject to  regulation by the Office of Thrift  Supervision  (the
"OTS"),  the  Federal  Deposit  Insurance   Corporation  (the  "FDIC")  and  the
Securities and Exchange  Commission (the "SEC").  Prior to the  Conversion,  Bay
State had not engaged in any material operations.

(2) Accounting Principles

     The accompanying  unaudited condensed  consolidated financial statements of
Bay State have been prepared in accordance  with generally  accepted  accounting
principles in the United States of America for interim financial information and
with the  instructions  to Form 10-Q and of  Regulation  S-X.  Accordingly,  the
financial  statements  do  not  include  all of the  information  and  footnotes
required by generally  accepted  accounting  principles  in the United States of
America for complete  financial  statements.  In the opinion of management,  all
adjustments (consisting of a normal recurring nature) considered necessary for a
fair  presentation  have been included.  Operating  results for the three months
ended June 30, 2001 are not  necessarily  indicative  of the results that may be
expected for the current fiscal year.

     For further  information,  refer to the consolidated  financial  statements
included in the Company's annual report and Form 10-K for the period ended March
31, 2001, filed with the SEC.

     The  year-end  condensed  balance  sheet  data  was  derived  from  audited
financial statements, but does not include all disclosures required by generally
accepted accounting principles in the United States of America.

(3) Stock Repurchase Program

     On March 23, 2001 the Company announced the completion of the repurchase of
97,923 shares under its sixth 5% stock repurchase  program and the approval of a
seventh 5% repurchase program consisting of 88,277 shares. As of August 13, 2001
approximately  36,600 shares have been  repurchased  under this  program,  at an
average price of $31.84.


                                       5
<PAGE>

(4) Impact on New Accounting Standards

     In June 1998,  the FASB  issued SFAS No. 133,  "Accounting  for  Derivative
Instruments and Hedging  Activities."  Statement No. 133, as amended by SFAS No.
138, establishes accounting and reporting standards for derivative  instruments,
including  certain  derivative  instruments  embedded in other contracts and for
hedging activities. The Statement is effective for all fiscal quarters of fiscal
years beginning after June 15, 2000. In management's  opinion, SFAS No. 133 will
not have a material effect on the Company's consolidated financial statements.

     FASB has issued SFAS No. 140,  Accounting  for  Transfers  and Servicing of
Financial Assets and  Extinguishments  of Liabilities.  This Statement  replaces
SFAS No. 125,  Accounting  for Transfers  and Servicing of Financial  Assets and
Extinguishments  of Liabilities,  and rescinds SFAS Statement No. 127, "Deferral
of the Effective Date of Certain Provisions of FASB Statement No. 125." SFAS No.
140 provides  accounting and reporting  standards for transfers and servicing of
financial assets and  extinguishments  of liabilities.  This statement  provides
consistent  standards for distinguishing  transfers of financial assets that are
sales from  transfers that are secured  borrowings.  This statement is effective
for  transfers  and  servicing  of  financial  assets  and   extinguishments  of
liabilities  occurring after March 31, 2001; however, the disclosure  provisions
are effective for fiscal years ending after  December 15, 2000.  The Company has
not yet  quantified the remaining  provisions  effective in 2001;  however,  the
Company does not expect that the adoption of this statement will have a material
impact on its financial position or results of operations.

     Statement  of  Financial   Accounting   Standards   No.  141  improves  the
consistency  of the  accounting  and  reporting  for  business  combinations  by
requiring that all business  combinations be accounted for under a single method
- the  purchase  method.  Use of the  pooling-of-interests  method  is no longer
permitted.  Statement  No. 141  requires  that the  purchase  method be used for
business  combinations  initiated  after  June  30,  2001.  Management  does not
anticipate any impact on the consolidated  financial statements upon adoption of
this statement.

     Statement of Financial  Accounting Standards No. 142 requires that goodwill
no longer be amortized to earnings, but instead be reviewed for impairment.  The
amortization of goodwill  ceases upon adoption of the Statement,  which for most
companies, will be January 1, 2002. Management does not anticipate any impact on
the consolidated financial statements upon adoption of this statement.


                                     Page 6
<PAGE>

Item 2 - Management's Discussion and Analysis of Financial Condition and Results
         of Operations (Unaudited)

     This report contains certain forward-looking  statements within the meaning
of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities  Exchange  Act  of  1934,  as  amended.   The  Company  intends  such
forward-looking  statements  to be covered  by the safe  harbor  provisions  for
forward-looking statements contained in the Private Securities Litigation 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  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 Form 10-K filing with
the SEC for the fiscal year ended March 31, 2001.

     Except as required by applicable law and  regulations  the Company does not
undertake-and  specifically  disclaims any  obligation-to  publicly  release the
result of any revisions which may be made to any  forward-looking  statements to
reflect events or circumstances  after the date of such statements or to reflect
the occurrence of anticipated or unanticipated events.

General

     The Bank is a federally chartered savings bank and is subject to regulation
by  the  OTS.  The  Bank's  business  activities  are  concentrated  in  Eastern
Massachusetts through six full service retail banking offices located in Norfolk
and Suffolk Counties,  Massachusetts.  Through these offices,  the Bank offers a
full range of retail and commercial  banking  products and services and conducts
other business as allowable for federally  chartered  banks.  The Bank primarily
makes residential first mortgages, commercial and multi-family real estate loans
and, to a lesser  extent,  home equity lines of credit,  other  consumer  loans,
residential construction loans, development and land loans and commercial loans.
Lending operations, particularly loan originations are conducted from the retail
offices  and at the point of sale.  Neither  the Company nor the Bank nor any of
their subsidiaries conduct business on a national or international basis.

     The operating  results of the Company depend  primarily on its net interest
and dividend income,  which is the difference  between (i) interest and dividend
income on earning  assets,  primarily  loans and investment  securities and (ii)
interest expense on interest bearing liabilities,  which consist of deposits and
borrowings.  Results of  operations  are also affected by the provision for loan
losses, the level of non-interest income, including deposit and loan fees, gains
on sales of assets, operating expenses and income taxes.


                                     Page 7
<PAGE>

Comparison  of  Financial  Condition  at  June  30,  2001  and  March  31,  2001
(Unaudited)

     Total  assets at June 30,  2001 were  $499.4  million,  compared  to $491.9
million at March 31, 2001, an increase of 1.5%. Net loans receivable,  including
mortgage  loans held for sale,  increased  $2.7 million,  or 0.6%,  primarily in
multi-family loans,  commercial real estate and construction  loans.  Short-term
investments,  which  consist  mainly of overnight  investments,  increased  $4.6
million.  The increase in assets was funded  primarily from a $26.0 million,  or
9.5%, increase in deposits, offset by a $19.4 decrease in Federal Home Loan Bank
advances.  The increase in deposits was a result of increased  marketing efforts
and  competitively  priced  products  offered by the bank.  Total  stockholders'
equity  was $54.2  million,  or 10.85% of total  assets,  at June 30,  2001,  an
increase of $411,000,  or 0.76%, from $53.8 million,  or 10.93% of total assets,
at March 31,  2001.  The increase in equity was the result of the net income for
the  period,  a small  decrease  in the market  value of  investment  securities
classified as available  for sale,  and a reduction in the  stock-based  benefit
plans,  offset by the repurchase of 12,850 shares of treasury stock at a cost of
$607,000,  and the payment of dividends.  The Company's  book value per share at
June 30, 2001 was $33.29,  compared to $32.77 at March 31, 2001,  an increase of
1.6%.

Investments

     Short-term  investments  were  $4.7  million  at June 30,  2001,  primarily
consisting of overnight  investments at the FHLB. This represents an increase of
$4.6  million  from  the  $114,000  at March  31,  2001.  Investment  securities
available-for-sale  decreased $63,000, or 0.18%,  primarily due to a decrease in
mortgage-backed securities offset by an increase in trust preferred securities.

     The Company's investment portfolio at June 30, 2001 reflects a $549,000 net
unrealized  gain  on  available-for-sale  securities  net of  tax,  compared  to
$617,000 at March 31, 2001.

     The table below shows the  investment  securities  portfolio at the periods
presented.   The  amortized   cost  and  estimated  fair  value  of  investments
available-for-sale were:

<TABLE>
<CAPTION>
                                         June 30, 2001          March 31, 2001
                                     --------------------    --------------------
                                     Amortized     Fair      Amortized     Fair
                                        Cost       Value        Cost       Value
                                     ---------    -------    ---------    -------
                                                (Dollars in thousands)
<S>                                   <C>         <C>         <C>         <C>
Marketable equity securities          $ 7,606     $ 8,808     $ 7,496     $ 8,654

Mortgage-backed securities             11,961      12,071      14,141      14,314

Trust preferred equity securities       9,602       9,516       7,559       7,510

Corporate bonds and notes               1,454       1,426       1,452       1,408

Preferred stocks                        1,500       1,472       1,500       1,467

Government agency securities            1,000       1,000       1,000       1,003
                                      -------     -------     -------     -------

Total                                 $33,123     $34,293     $33,148     $34,356
                                      =======     =======     =======     =======
</TABLE>


                                     Page 8
<PAGE>

     The amortized  cost and estimated  market  values of  investments  held-to-
maturity were:

<TABLE>
<CAPTION>
                                                      June 30, 2001         March 31, 2001
                                                    -----------------     ------------------
                                                    Amortized    Fair     Amortized    Fair
                                                      Cost      Value       Cost       Value
                                                     -----      -----      ------      -----
                                                             (Dollars in thousands)
<S>                                                   <C>        <C>        <C>        <C>
Mortgage-backed and mortgage-related securities       $269       $278       $336       $345
                                                      ----       ----       ----       ----

Total Mortgage-backed and mortgage related
Securities                                            $269       $278       $336       $345
                                                      ====       ====       ====       ====
</TABLE>


Loans

     During  the  first  quarter  of fiscal  year  2002,  net loans  receivable,
including mortgage loans held for sale,  increased by $2.7 million,  or 0.6%, as
detailed below:


<TABLE>
<CAPTION>
                                                     June 30,     % of total      March 31,        % of total
                                                       2001         Loans           2001              Loans
                                                     --------       -----         --------         ----------
                                                                     (Dollars in thousands)
<S>                                                  <C>            <C>           <C>                <C>
Mortgage loans:

         Residential 1 - 4 family                    $190,566       43.71%        $205,284           47.93%

         Multi-family                                  94,713       21.72           87,040           20.32

         Commercial real estate                       102,904       23.60           98,566           23.01

         Construction and development/land             25,570        5.86           17,319            4.04
                                                     --------      ------         --------          ------
              Total mortgage loans                    413,753       94.89          408,209           95.30

Commercial loans                                        5,870        1.35            3,893            0.91
Consumer loans:

         Equity lines                                  11,932        2.74           11,819            2.76
         Other consumer loans                           4,435        1.02            4,397            1.03
                                                     --------      ------         --------          ------

              Total loans                             435,990      100.00%         428,318          100.00%
                                                                   ------                           ------
Deduct:

         Allowance for loan losses                      4,280                        4,258

         Undisbursed proceeds of construction
           and development loans in process            11,759                        6,154

         Unearned income, net                             247                          202
                                                     --------                     --------

              Loans, net                              419,704                      417,704
                                                     --------                     --------

         Mortgage loans held-for-sale                     702                           --
                                                     --------                     --------

Loans, net and mortgage loans held-for-sale          $420,406                     $417,704
                                                     ========                     ========
</TABLE>

     At June 30, 2001 loans serviced for others was $22.9  million,  compared to
$22.6 million at March 31, 2001.



                                     Page 9
<PAGE>

Asset Quality

     At June 30, 2001  non-performing  assets  totaled  $233,000,  a decrease of
$135,000,  or 36.7%,  from  $368,000 at March 31,  2001.  Non-performing  assets
consist of all loans that are  delinquent  90 days or more,  and any real estate
owned.  This decrease was the result of certain  non-accrual loans being brought
current and paid off, and the charge-off of two consumer loans.  The Bank had no
other real estate owned at June 30, 2001 and March 31,  2001.  At June 30, 2001,
non-performing  assets  represented  0.05% of total  assets  and  0.06% of loans
receivable net, compared to 0.07% and 0.09%, respectively, at March 31, 2001.

     The  composition  of  non-performing   assets,   which  consist  solely  of
non-performing loans for the periods presented was:



                                             June 30,       March 31,
                                          2001      2000      2001
                                          ----     ------     ----
                                           (Dollars in thousands)

Non-accrual loans:
     Mortgage Loans:
      One-to-four-family                  $233     $1,036     $320
      Multi-family                          --         --       --
      Commercial real estate                --        443       --
      Construction and development          --         --       --
                                          ----     ------     ----
         Total mortgage loans              233      1,479      320
                                          ----     ------     ----
     Consumer Loans:
      Equity lines                          --         --       20
      Other consumer loans                  --         50       28
                                          ----     ------     ----
         Total consumer loans               --         50       48
                                          ----     ------     ----
         Total non-accrual loans           233      1,529      368
                                          ----     ------     ----
Real estate owned, net                      --         42       --
                                          ----     ------     ----
Total non-performing assets               $233     $1,571     $368
                                          ====     ======     ====

Non-performing assets as a percentage of:
      Loans receivable, net               0.06%      0.39%    0.09%
      Total assets                        0.05       0.34     0.07

The following  represents  the activity in the allowance for loan losses for the
three months ended June 30, 2001:

                                      (Dollars in thousands)

      Balance at March 31, 2001               $4,258

      Provision for loan losses                   62

      Losses charged to allowance                (40)
      Recoveries                              ------
      Balance at June 30, 2001                $4,280
                                              ======

     The Bank  continually  reviews its delinquency  position,  underwriting and
appraisal  procedures,  charge-off  experience  and current  real estate  market
conditions with respect to its entire loan portfolio.  While management uses the
best information available in establishing the allowance, future adjustments may
be necessary if economic  conditions  differ from the assumptions used in making
the current evaluation.


                                    Page 10
<PAGE>


Deposits and Borrowed Funds

     Deposits  increased during the three-month  period ending June 30, 2001, as
detailed below:

<TABLE>
<CAPTION>
                                 June 30,     % of total      March 31,     % of total
                                   2001        deposits         2001         deposits
                                   ----        --------         ----         --------
                                               (Dollars in thousands)
<S>                              <C>              <C>         <C>             <C>
Regular savings accounts         $ 27,762         9.28%       $ 28,031        10.26%
NOW accounts                       37,457        12.52          30,146        11.03
Money market accounts              94,731        31.66          77,857        28.49
Non-interest bearing deposits      14,096         4.71          11,721         4.29
                                 --------       ------        --------       ------
                                  174,046        58.17         147,755        54.07
Term deposits                     125,187        41.83         125,508        45.93
                                 --------       ------        --------       ------
         Total deposits          $299,233       100.00%       $273,263       100.00%
                                 ========       ======        ========       ======
</TABLE>

     During the period, FHLB advances decreased $19.4 million, or 12.3%.

Comparison  of  Operating  Results for the Three  Months ended June 30, 2001 and
2000.

General
     Consolidated  net income for the three  months  ended June 30, 2001 totaled
$1.2 million,  or $0.71 per basic earnings per share and $0.68 fully diluted per
share,  compared to  $807,000,  or $0.45 per basic  earnings per share and fully
diluted per share, for the same period last year. This represents an increase of
$359,000,  or 44.5%, in net income,  a $0.26 or 57.8% increase in basic earnings
per share  and a $0.23 or 51.1%  fully  diluted  per  share.  The  increase  was
primarily  due to higher net  interest  income due to an increase in the average
balance of interest earning assets, an improving net interest margin and spread,
increased fees and non-interest income, and a decrease in the provision for loan
losses,  offset in part by higher  income taxes and an increase in  non-interest
expense.

Interest Income
     Interest  income  for the  three  months  ended  June  30,  2001  increased
$798,000, or 9.1%, to $9.6 million, compared to $8.8 million for the same period
last year.  The increase in interest  income was primarily due to an increase in
the average  balance of  interest-earning  assets,  which  increased from $438.1
million  for the quarter  ended June 30, 2000 to $459.2  million for the quarter
ended June 30, 2001, an increase of $21.1 million,  or 4.8%. The increase in the
average  balance of  interest-earning  assets was  primarily  a net result of an
increase in the average balance of loans, net of $19.5 million,  or 5.0%, and an
increase in Federal Funds sold and interest earning deposits of $1.2 million, or
71.8%. The yield on interest-earning assets increased 33 basis points to 8.33%.

Interest Expense
     Interest  expense  for the  three  months  ended  June 30,  2001  increased
$144,000,  or 2.9%, to $5.1 million compared to $4.9 million for the same period
last  year.  The  increase  in  interest  expense  was the net result of a $18.6
million,   or  4.7%,   increase  in  the  average  balance  of  interest-bearing
liabilities  which increased from $396.9 million for the three months ended June
30,  2000 to $415.5  million for the three  months  ended June 30,  2001,  and a
decrease of 8 basis  points in the cost of funds to 4.89%.  The  increase in the
average  balance of  interest-bearing  liabilities  was primarily a result of an
increase in the average  balance of deposits of $17.0 million,  or 7.0%, and the
average balance of FHLB advances and other borrowings of $1.7 million, or 1.1%.


                                    Page 11
<PAGE>

Net interest income
     The table below shows the average  balance sheet,  the interest  earned and
paid  on  interest-earning  assets  and  interest-bearing  liabilities  and  the
resulting net interest spread and margin for the periods presented.

<TABLE>
<CAPTION>
For the three months ended June 30,                            2001                                2000
                                              ----------------------------------      -------------------------------
                                                             Interest                            Interest
                                               Average        Income/     Yield/      Average     Income/       Yield/
                                               balance       expense       rate       balance     expense        rate
                                              --------      --------      ------      -------     -------        ----
                                                                     (Dollars in thousands)
<S>                                           <C>           <C>            <C>        <C>         <C>            <C>
     Asset
     Interest-earning assets:
     Short-term investments                   $  2,138      $     18       3.37%      $  1,692    $    26        6.15%
     Interest-earning deposits                     769            10       5.20             --         --          --
     Taxable investment securities              24,475           449       7.34         21,365        369        6.91
     Mortgage backed & related securities       17,637           269       6.10         20,375        301        5.91
     Loans (net of unearned income)            414,190         8,813       8.51        394,652      8,065        8.17
                                              --------      --------                  --------    -------
     Total interest-earning assets             459,209         9,559       8.33        438,084      8,761        8.00
                                                            --------                              -------
     Non interest-earning assets                32,507                                  26,928
                                              --------                                --------
           Total                              $491,716                                $465,012
                                              ========                                ========
     Liabilities and Equity
     Interest-bearing liabilities:
           Now accounts                       $ 27,194      $     63       0.93%      $ 22,645    $    63        1.11%
           Regular savings accounts             27,255           134       1.97         26,225        135        2.06
           Money market accounts                82,123           902       4.39         69,233        741        4.28
           Certificate accounts                123,957         1,738       5.61        125,462      1,716        5.47
                                              --------      --------       ----       --------    -------        ----
     Total interest-bearing deposits           260,529         2,837       4.36        243,565      2,655        4.36
           FHLB advances                       153,017         2,214       5.72        147,391      2,191        5.88
           Other borrowings                      2,000            25       4.95          5,956         86        5.71
                                              --------      --------                  --------    -------
     Total interest-bearing liabilities        415,546         5,076       4.89        396,912      4,932        4.97
                                                            --------                              -------
           Demand deposits                      11,674                                   6,593
           Other liabilities                    10,522                                   8,213
           Equity                               53,974                                  53,294
                                              --------                                --------
           Total                              $491,716                                $465,012
                                              ========                                ========
     Net interest income                                    $  4,483                              $3,829
                                                            -------                               ------
     Interest rate spread                                                  3.44%                                 3.03%
                                                                           ----                                  ----
     Net interest margin                                                   3.90%                                 3.50%
                                                                           ----                                  ----
</TABLE>


                                    Page 12
<PAGE>

     The following  table  presents the effects of changing rates and volumes on
the interest income and interest  expense of the Company.  The rate column shows
the effects attributable to changes in rate (changes in rate multiplied by prior
volume).  The volume column shows the effects  attributable to changes in volume
(changes in volume  multiplied by prior rate). The net column represents the sum
of the prior columns.

                                           Quarter ended June 30,
                                               2001 vs. 2000
                                               -------------
                                      Change due to Increase (Decrease)
                                      --------------------------------
                                          Volume     Net       Rate
                                          ------     ---       ----
                                            (Dollars in thousands)
Interest income:
         Loans                            $ 408     $ 340     $ 748
         Interest earning deposits           10        --        10
         Federal Funds sold                  11       (19)       (8)
         Taxable investment securities       56        24        80
         Mortgage-backed securities         (42)       10       (32)
                                          -----     -----     -----
              Total                         443       355       798
                                          -----     -----     -----
Interest expense:
         Deposits                           128        54       182
         Borrowings                          27       (65)      (38)
                                          -----     -----     -----
              Total                         155       (11)      144
                                          -----     -----     -----
Net interest income                       $ 288     $ 366     $ 654
                                          =====     =====     =====

Provision for Loan Losses

     Provisions for loan losses are charged to operations to bring the allowance
for loan  losses to a level  considered  by  management  to be adequate to cover
estimated  losses on loans  receivable  which are deemed  probable and estimable
based on  information  currently  known to  management.  The  provision for loan
losses totaled $62,000 for the quarter ended June 30, 2001, compared to $165,000
for the same period last year. The provision reflects  management's  analysis of
the risks  associated with the Banks' primary lending  objective to increase the
overall loan  portfolio.  The current  level of provision is  reflective  of the
increase in the overall  size and mix of the loan  portfolio  and the decline in
non-performing loans during the period. The decrease from the level added during
the last  fiscal  year is  directly  related to the lower net growth in the loan
portfolio from the same period last year.

     The  allowance  for loan losses was $4.3 million at June 30, 2001 and March
31, 2001,  respectively,  which represents 1,836.9% of non-performing assets and
1.01% of total loans at June 30,  2001,  compared to 1,157.1% of  non-performing
assets and 1.01% of total loans at March 31, 2001.

     While management believes the Banks allowance for loan losses is sufficient
to cover losses  inherent in its loan  portfolio at this time, no assurances can
be given that the Bank's level of allowance  for loan losses will be  sufficient
to cover future losses  incurred by the Bank, or that future  adjustments to the
allowance for loan losses will not be necessary if economic and other conditions
differ  from the  economic  and  other  conditions  analyzed  by  management  to
determine the current level of the allowance for loan losses.


                                    Page 13
<PAGE>

Non-interest income

     Total   non-interest   income,  net  of  gains  and  losses  on  investment
activities,  was  $313,000  for the  quarter  ended June 30,  2001,  compared to
$248,000 for the same period last year, an increase of $65,000,  or 26.2%. These
changes  were  primarily  a result of an  increase  in fees on loans and deposit
accounts  and  tax-advantaged  income  received  on bank  owned  life  insurance
policies.  The Company  recognized a $69,000 gain on trading  activities for the
period ended June 30, 2001,  compared to a $56,000 loss for the same period last
year.  These gains and losses  represent  the change in the market  value of the
assets supporting certain employee benefit plans.

Non-interest expense

     Total non-interest  expense was $2.9 million for the quarter ended June 30,
2001, compared to $2.6 million for the same period last year. Total salaries and
benefits increased $132,000, or 7.8%, primarily the result of a general increase
in  salaries  and  benefits  due to the  increased  number of  employees  and an
increase in the costs  associated with the Bank's ESOP plan due to the increased
stock price.  Occupancy  and equipment  expense  totaled  $393,000,  compared to
$349,000 for the same period last year, an increase of $44,000,  or 12.6%.  This
increase was the result of the increased  level of  depreciation on building and
leasehold  improvements  associated with the addition of the new Walpole branch,
and the relocation of the Dedham branch.  Advertising  expense totaled $153,000,
compared to $134,000 for the same period last year,  an increase of $19,000,  or
14.2%,  primarily a result of retail  deposit  promotions  being  offered by the
bank. Data processing expense increased $37,000, or 52.1% as a result of the new
retail deposit  products and services  being offered and the increased  level of
deposit  and  loan  accounts.  Other  expenses,   including  professional  fees,
increased $30,000, or 8.1%.

Income Taxes

     Income  taxes for the three  months  ended June 30,  2001 were  $749,000 on
pretax  income of $1.9  million,  for an  effective  rate of 39.1%,  compared to
$423,000 on pretax  income of $1.2 million,  for an effective  rate of 34.4% for
the same period last year.  The change in effective  tax rates from year to year
was a result of the  development  of a valuation  allowance  on the deferred tax
asset  for  the   contribution   deduction   carryover   and  the   increase  in
non-deductible expense portion associated with the Bank's ESOP plan.

Item 3 - Quantitative and Qualitative Disclosures about Market Risk

     Management is responsible  for monitoring and limiting the Bank's  exposure
to  interest  rate risk  within  established  guidelines  while  maximizing  net
interest  income.  The Bank will  continue  to monitor  its  interest  rate risk
sensitivity with the primary objective to prudently  structure the balance sheet
so that  movements  of  interest  rates on assets  and  liabilities  are  highly
correlated  and  produce a  reasonable  net  interest  margin even in periods of
volatile interest rates.  Further  discussion on market risk is in the Company's
Form 10-K for the year ended March 31, 2001.

Asset/Liability Management

     The  principal  objective  of the  Bank's  interest  rate  risk  management
function is to evaluate the interest rate risk included in certain balance sheet
accounts,  determine  the  appropriate  level of risk given the Bank's  business
strategy,   operating  environment,   capital  and  liquidity  requirements  and
performance  objectives  and  manage  the  risk  consistent  with  the  Board of
Directors'  approved  guidelines.  Through  such  management,  the Bank seeks to
reduce the vulnerability of its operations to changes in interest rates.


                                    Page 14
<PAGE>


     The Bank  monitors  its  interest  rate  risk as such risk  relates  to its
operating  strategies.   The  Bank's  Board  of  Directors  has  established  an
Asset/Liability   Committee,   responsible  for  reviewing  its  asset/liability
policies and interest  rate risk  position,  which meets on a monthly  basis and
reports  trends and interest  rate risk  position to the Board of Directors on a
quarterly  basis. The extent of the movement of interest rates is an uncertainty
that could have a negative impact on the earnings of the Bank.

     In recent years, the Bank has primarily  utilized the following  strategies
to manage  interest rate risk: (i)  emphasizing  the origination and purchase of
adjustable-rate loans; (ii) investing primarily in U.S. Government securities or
mortgage-backed   and   mortgage-related   securities  with  shorter   estimated
maturities;  (iii) utilizing FHLB advances to better structure the maturities of
its interest rate  sensitive  liabilities;  and (iv) to a  substantially  lesser
extent,  selling in the secondary market longer-term  fixed-rate  mortgage loans
originated while generally retaining the servicing rights on such loans.

Gap Analysis.

     The matching of assets and  liabilities  may be analyzed by  examining  the
extent to which such assets and liabilities are "interest rate sensitive" and by
monitoring a bank's interest rate sensitivity  "gap." Assets and liabilities are
said to be interest  rate  sensitive  within a specific time period if they will
mature or reprice within that time period.  The interest rate sensitivity gap is
defined as the difference between the amount of interest-earning assets maturing
or repricing  within a specific  time period and the amount of  interest-bearing
liabilities  maturing or  repricing  within that same time  period.  At June 30,
2001,  the  Company's  cumulative  one  year  interest  rate gap  (which  is 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) as a  percentage  of total  assets,  was a  negative  15.2%.  A gap is
considered  negative  when the amount of  interest  rate  sensitive  liabilities
exceeds the amount of interest  rate  sensitive  assets.  Accordingly,  during a
period of rising  interest  rates,  an institution  with a negative gap position
would  be in a worse  position  to  invest  in  higher  yielding  assets  which,
consequently,  may  result  in  the  cost  of its  interest-bearing  liabilities
increasing at a rate faster than its yield on interest-earning assets than if it
had a positive gap.  Conversely,  during a period of falling  interest rates, an
institution  with a  negative  gap  would  tend  to  have  its  interest-bearing
liabilities repricing downward at a faster rate than its interest earning assets
as compared to an institution with a positive gap which, consequently,  may tend
to positively affect the growth of its net interest income.


                                    Page 15
<PAGE>

<TABLE>
<CAPTION>
                                                              More         More          More
                                                              than         than          than
                                                             1 Year       3 Years        5 Years     Greater
                                              1 Year           to            to            to          than       Total
                                              or Less        3 Years      5 Years       15 Years     15 Years     Amount
                                             -----------------------------------------------------------------------------
                                                                         (Dollars in thousands)
<S>                                          <C>            <C>           <C>           <C>          <C>         <C>
  Interest-earning assets:
   Short-term investments ...............    $   4,715      $     --     $      --      $     --     $    --     $  4,715
   Investment in B.O.L.I ................        8,360            --            --            --          --        8,360
   Taxable investment Securities ........       11,573           497           957         8,135          --       21,162
   Mortgage-backed securities ...........           --            --            --         3,501       8,729       12,230
   Stock in FHLB-Boston .................        8,455            --            --            --          --        8,455
   Loans (1) ............................      109,122        78,101        68,389       105,862      62,277      423,751
                                             ---------      --------      --------      --------     -------     --------
      Total interest-earning assets .....    $ 142,225      $ 78,598     $  69,346      $117,498     $71,006     $478,673
                                             =========      ========      ========      ========     =======     ========
  Interest-bearing liabilities:
   Money market accounts ................    $  75,785      $ 14,217     $   4,729      $     --     $    --     $ 94,731
   Regular savings accounts .............        4,163         8,329         8,329         6,941          --       27,762
   NOW accounts .........................        1,872         3,746         3,746         9,364      18,729       37,457
   Certificate accounts .................      107,121        13,716         4,350            --          --      125,187
   Other borrowed funds .................        2,000            --            --            --          --        2,000
   FHLB advances ........................       27,328        41,370        70,000            --          --      138,698
                                             ---------      --------      --------      --------     -------     --------
      Total interest-bearing liabilities     $ 218,269      $ 81,378     $  91,154      $ 16,305     $18,729     $425,835
                                             =========      ========      ========      ========     =======     ========
  Interest-earning assets less
   interest-bearing liabilities .........    $ (76,044)     $ (2,780)      (21,808)     $101,193     $52,277     $ 52,838
                                             =========      ========      ========      ========     =======     ========
  Cumulative interest-rate
   sensitivity gap ......................    $ (76,044)     $(78,824)    $(100,632)     $    561     $52,838
                                             =========      ========      ========      ========     =======
  Cumulative interest-rate gap as
   a percentage of total assets .........       (15.22)%      (15.78)%      (20.15)%        0.11%      10.58%
  Cumulative interest-rate gap as
   a percentage of total interest-
   earning assets .......................       (15.89)%      (16.47)%      (21.02)%        0.12%      11.04%
  Cumulative interest-earning
   assets as a percentage of
   cumulative interest-bearing
   liabilities ..........................        65.16%        73.69%        74.25%       100.14%     112.41%
</TABLE>

-------------
  (1) Excludes non-accrual loans


                                    Page 16
<PAGE>

PART II - OTHER INFORMATION

Item 1 - Legal Proceedings

     Neither  the Company  nor any of its  subsidiaries  is party to any pending
legal proceedings which are material other than routine litigation incidental to
their business activities.

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 Bay State Bancorp, Inc. *

          3.2  Amended and Restated Bylaws of Bay State Bancorp, Inc. **

          4.0  Stock Certificate of Bay State Bancorp, Inc. *

          11.0 Computation of per share earnings (filed herewith)

*    Incorporated   herein  by   reference   from  the  exhibits  to  Form  SB-2
     registration statement as amended, Registration No. 333-40115
**   Incorporated herein by reference from the registrants Form 10-KSB, as filed
     with the Securities and Exchange Commission on June 14, 1999.

     (b) Reports on Form 8-K

          (i) None


                                    Page 17
<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.


                                   Bay State Bancorp, Inc.


August 13, 2001                    \s\ John F. Murphy
----------------------             ---------------------
Date                               John F. Murphy
                                   Chairman, President, and
                                   Chief Executive Officer
                                   (Principal Executive Officer)

August 13, 2001                    \s\ Michael O. Gilles
----------------------             ---------------------
Date                               Michael O. Gilles
                                   Senior Vice President and
                                   Chief Financial Officer
                                   (Principal Accounting and Financial Officer)


                                    Page 18